Income Tax Department Denies Proposal to Raise Capital Gains Tax for Income Inequality
Image Source: BQ Prime
The Income Tax Department issued a clarification on Tuesday that there is no current proposal to increase the capital gains tax to address the issue of rising income inequality in India. This statement comes in response to a recent report by Bloomberg which stated that India is considering reviving a proposal to reform the direct tax system, with the aim of reducing income inequality, in the event that Prime Minister Narendra Modi returns to power in the 2024 Lok Sabha election.
The Income Tax Department’s clarification will come as a relief to investors who were worried about the impact of such a proposal on their returns. Capital gains tax is a tax levied on the profit from the sale of an asset such as property or shares, and an increase in this tax could have a negative effect on investments in India. However, the issue of income inequality in India is a growing concern, and it is likely that the government will continue to explore different options to address this issue. The government has already taken steps to increase the tax base and crack down on tax evasion, but more needs to be done to ensure that the benefits of economic growth are shared by all sections of society.
Re-Reported from the story originally published in BQ Prime
